Feb 19, 2017

The Robust Market For Domain Names

The enduring power of imagination and symbolism at scale. JL

Ingrid Burrington reports in The Atlantic :

Registries and registrars make up the layer that most internet
users and domain name purchasers recognize. Beyond them lies
“the aftermarket,” a realm dominated by the savvy investor
scooping up good domain names. It speaks to that founding myth of the internet and
of computation in general: that anyone could make something out of
nothing, and, an
idea could be made manifest just by invoking some keywords, a dot, and a
subtext-loaded suffix.If you’ve ever wondered what the peak of capricious financial speculation looks like, a domain-names auction might be a good guess. Imagine, dear reader, sitting in a darkened Las Vegas hotel conference room with maybe a hundred people, watching numbers flash on a screen as bidders in the room compete with online bidders, whose user handles (such as “crazydot” and “youlosers”) intermittently flash on the screen. The repetitive cadence of the auctioneer’s call makes your heart race as it goes once, twice, and delivers assets like archeology.com (yes, a misspelling of archaeology) to the highest bidder for $23,000. (Someone paid three-fifths of my after-taxes income for a typo!)
That wasn’t even the highest-selling domain in the auction.

Perhaps I shouldn’t have been shocked by the cold financial reality I watched unfold at this auction during NamesCon, an annual conference for the domain-names industry. Why would approximately 1,400 people voluntarily come to Las Vegas for four days to talk about domain names if there wasn’t money involved?Before NamesCon, I thought of myself as a pretty serious domain names enthusiast. But compared to the die-hard “domainers,” I was a dilettante with my measly thirty-some domains, most of which were for one-liner joke sites, art projects, and phrases I just thought would make good domain names.​As a person who grew up online during the heyday of weird domain hacks, I mostly thought of domain names as a very niche genre of experimental poetry, one in which radical constraints (availability, brevity, the cadence of an interrupting “dot”) produce small, densely packed pockets of internet magic. They were part of what made the web weird—and, with the introduction of a range of new top-level domains (TLDs) since 2012, (1,215 and counting), I was excited about how much weirder things might become. Domain names, done right, can be as resonant as a Jenny Holzer truism or an Ed Ruscha painting, giving life and character to one-liner joke websites, standalone artworks, and political campaigns. (For newcomers to domain name poetics: use .horse for anything and it’s immediately funny. That TLD is basically the greatest thing to happen to the internet since HTML5.)
This is, apparently, not how most people think about domain names. Most people don’t actually really think that much about domain names at all, or about the fact that without them we’d have to memorize strings of IP addresses to find websites. Domains weren’t even originally considered that central to the web—they were supposed to stay hidden behind links, but the early browser design choice for an address bar quickly made domain names a crucial component of wayfinding, branding, and making jokes.In addition to being crucial to making the web work, domain names are also a highly political pocket of the web, particularly shaped by the legacy of colonialism. Most of the underlying protocols that make the internet work—including DNS—are encoded in ASCII, which translates bits into letterforms, numbers, and punctuation marks. But ASCII’s letterforms only represent the Latin alphabet, limiting expression in domain names to Western languages (while arguing that a character encoding is an instrument of imperialism sounds bold, so does assuming that “text” is synonymous only with “English”).
Unicode was supposed to solve this problem, along with a weird DNS hack called (not even joking) Punycode. While it’s now possible to create Unicode-encoded domains, it’s a pretty annoying hack and adoption remains pretty limited. Then there’s the fact of country-code TLDs (ccTLDs) themselves—created in the early days of the ARPANet by Jon Postel, the decision to give every country its own TLD required deciding what even constituted a legitimate country. Postel sidestepped this decision by using the International Standards Organization’s existing list of two-letter country codes, which opened the door to the classical period of domain hacks where startups and geeks would use ccTLDS to spell out a company name or come up with some clever wordplay (bit.ly probably being one of the better-known, still existing companies; I’m still waiting for someone to act on quantifiedself.ie). It also led to those domain hackers getting unexpected crash courses in international politics, with uprisings and civil war abruptly shutting down Libyan and Syrian domains—as in the case of art world startup Artsy, who had to abandon their bespoke art.sy domain name in 2013 as the Syrian civil war worsened. ccTLDs also created some unfortunate repeats of past colonial violence, as seen in the backstory of .io.That thrill of the “catch,” the excitement at snagging a cool domain name—that I could relate to.It was an interest in the tension between the magical potential of domain names and their dark side—and in the people and companies who deal in that tension on a day-to-day basis—that brought me to this domain name industry conference. That, and I really wanted to find out the origin story of .horse. (Somewhat anticlimactically, I did meet the CEO of the company that owns .horse but he came to the company after the TLD acquisition so its origin story didn’t come to me straight from the horse’s mouth, as it were.)
So, I went to the desert with my .horse domains. (Which felt good, even though it did rain.) Las Vegas is a popular destination for conferences, and an even more popular rhetorical device for questionable metaphors by coastal-city-dwelling nonfiction writers. I tried, and failed, to restrain myself from reading too heavily into the fact that a conference on what is often described as the internet equivalent of real-estate speculation took place in a city that is itself fueled by speculative markets. The comparisons are pretty hard to ignore—in their idealized forms, the domain name industry and Las Vegas are manifestations of the fantasy of making something from nothing, wealth seemingly conjured from thin air but dependent on very old, very fraught infrastructure. There’s also an obvious gamble made with each one-year domain contract: the one over whether you’ll actually do anything with the domain name. How many times have I justified a domain renewal or purchase with of course I’ll make that project—I already bought a domain for it or that’s such a good domain, I’ll come up with a project for it, I swear, it’s too good to pass up?The making of a “good domain name” is, I heard in conference sessions and was told repeatedly by NamesCon attendees, more alchemy than chemistry. Again, brevity is typically a good move, though memorable phrases are also effective. Some TLDs are hot right now (.io), and some single words are always a good investment (lotions.com, furs.com), but good TLDs and good words together don’t always work (as was explained to the owner of furs.io and lotions.io in one session). Long-time domainers also had oddly specific advice—”Hyphens make your domain less valuable—unless you’re in Germany” and “.info is a dead zone.”
Michael Cyger, the operator of domain industry website DomainSherpa, offered one of the domains up for auction as an example of an excellent domain investment. While cranberry.com doesn’t appear to be a particularly compelling domain, Cyger argued that if you “just search [the U.S. Patent and Trademark Office] for cranberry,” it becomes apparent that a lot of companies have hinged their brand to that one word. (Searching USPTO’s patents database for assignees with “cranberry” in their name actually only offers up three companies, so maybe it wasn’t the best example, but conceptually I guess it makes sense). There’s a whole vocabulary for these domain investments—”generics” like the word cranberry.com, “brandables” which are basically ideas for products that don’t exist yet but might eventually, the ultra-rare “numerics” which mostly seem useful for Chinese markets because of the use of numbers in pinyin, a transliteration of Chinese words into the Latin alphabet.And it is important to call them “investments”—while the mid-to-late 1990s era of domain speculation was marked by the pejorative term “cybersquatting,” NamesCon represented an industry, not a grift. After all, not all of the money in domaining comes from high-value sales. There are a lot of different services and businesses that make up the domain name industry—it’s a big enough industry to have an industry association.On the less speculative side, there’s the actual domain name registries, the people who maintain DNS servers for top-level domains (the part that domainers sometimes refer to as “the right of the dot”—.com, .info, .horse). Then there are registrars (this is understandably confusing), which are the firms people go to when they want to actually buy a domain name.*
Registries and registrars make up the layer that most normal internet users and amateur domain name purchasers recognize. Beyond them lies “the aftermarket,” a realm dominated by the savvy domain investor scooping up good domain names. There are law firms that specialize in intellectual property defense for domainers whose investments hit too close to existing trademarks (the legal process for these trademark disputes involves some arcane wizardry that, dear reader, I am sparing you for your own good). There are other legal services that assist in high-value domain transfers and help domainers find best approach to claiming domain name sales on taxes (apparently, depending on how you handle a domain name sale you can claim capital gains tax). There are domain name companies that only deal in “brandables,” selling corporate scaffolding to startups too busy disrupting to come up with a name (most of these companies also provide logos with their brandable domain names, which is possibly the weirdest graphic design job I can imagine). There are brokers who help with the transfer of domain names. There are portfolio-management services and auction platforms specifically created for domainers.

It was one of those niche fields that got Mike Carson into the domains industry. He’s a “dropcatcher,” which means he keeps an eye on the registration expiration dates of good domain names. There’s a slim window after a good domain’s expiration to register it, and usually there’s a whole slew of other people trying to “catch” the domain. For a fee, companies like Carson’s will make sure you’re the first in line. He mostly traffics in cool ccTLDs, which means that he frequently deals with the vagaries of geopolitics (one domain he “caught” for a client had to be returned after Libyan domain registry Libyan Spider reached out to explain that the original owner had been kidnapped some time ago and the registry was holding the domain until his release). I still kind of can’t believe this is something someone can build a career doing, but Carson’s having a lot of fun with it. “It’s like a game,” he explained.That thrill of the “catch,” the excitement at snagging a cool domain name—that I could relate to. Despite the conference’s focus on the business side of domains, many attendees’ appreciation did seem to go beyond monetization, as evidenced by the sentimental attachment that people expressed when I asked about the first domains they purchased, or domains they regretted giving up. Comparisons to letting children go off into the world or The One That Got Away came up frequently. It made sense when Jothan Frakes, the chief emcee and one of the organizers of NamesCon (first domain: jothan.com), told me that a lot of his domainer friends also had other side-hobbies that involved collecting—shoes, stamps, in Frakes’s case comic books and records.Of course, one person’s collector is another’s hoarder. There are domain names that will remain forever trapped in the cycle of speculation, going from one domain investor’s portfolio to another’s or leased to third parties—the likelihood that the highest bidder on archeology.com is going to do anything with it is honestly pretty low. While it’s admittedly a minor thing to mourn, those domains that would never manifest into actual websites were at the heart of what I found so depressing about the auction. It reminded me more of the art market than real estate, the more commonly used metaphor for the domain name market. Like paintings that will at best only see the light of well-appointed collector’s penthouses, those thousands of brilliant little turns of phrase would never emerge from speculation to become brilliant websites, instead acting only as devices for moving money around. It felt like a foreclosure on future creativity.It also speaks to that first, fictional founding myth of the internet ... that anyone could make something out of nothing.There was at least one other pure-domains enthusiast like me at NamesCon, but, to be fair, he came to the conference because I told him about it. After learning about NamesCon, Daniel Temkin (an artist and acquaintance from New York) managed to convince the organizers that their industry conference could use some literary performance art. Temkin came with slightly more quixotic mission than mine: In the heart of the trade show floor, he performed readings from Internet Directory, his 37,000-page book of 115 million .com domain names listed in alphabetical order. He’ll usually read these excerpts (in the form of giant canvas prints) in hypnotic one-hour sprints.
Temkin’s recitations provided a weird comfort in contrast to the auction’s. Internet Directory is a wonderful meditation on the domain-name form—whether it’s a five-letter word or a five-word phrase, something just happens with the appending of the words dot com. That ineffable something is admittedly tinged with nostalgia for the era of the first dot-com bubble, when many of these domains were probably registered and all sorts of terrible ideas sounded like viable business plans once they became URLs. But it also speaks to that first fictional founding myth of the internet and of computation in general: that anyone could make something out of nothing, and with the payment of a fee and some backend conjuring, an idea could be made manifest just by invoking some keywords, a dot, and a subtext-loaded suffix. And although the internet was never really that idealized libertarian paradise of meritocracy, it had—maybe still has?—room for weirdness to poke through.While I ostensibly came to NamesCon out of curiosity, I also considered the journey to the dark heart of domain names a personal test of faith. If I could keep ahold of my belief in magic and poetry within the turgid fluorescent eternity of a Las Vegas casino conference center, maybe I could hold onto it in the face of darker currents unfolding throughout the world. Frivolity and jokes may not be a solid foundation for resistance, but they allow for the occasional hosanna through what can at times become a dirge.
And while domain names are no more the anchor point of resistance than the websites they’re tied to, or the basic civic-engagement those websites might encourage, they are small, salient points where poetry and solidarity can take hold—whether it’s in ridiculous dot-com turns of phrase, incisive use of a ccTLD, or just a silly one-liner .horse site. And I do think it’s important to hold onto those poetic pockets of weirdness that bring wonder to not only increasingly uniform, banal, and brutal internet but an increasingly banal and brutal future. Because if you’re not in a fight for a future that still has room for weirdness and magic, it’s not much of a future worth fighting for.

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As a Partner and Co-Founder of Predictiv and PredictivAsia, Jon specializes in management performance and organizational effectiveness for both domestic and international clients. He is an editor and author whose works include Invisible Advantage: How Intangilbles are Driving Business Performance.Learn more...